Israel should withdraw from Arab territory and allow the creation of a Palestinian state before Arabs recognize it, a Saudi official said Monday, reacting to Israeli prime minister's call to Arab leaders to discuss their ideas for peace with him.

The Saudi official told The Associated Press that "before any meeting could be considered," Israel should accept the 2002 Arab peace initiative that would recognize Israel in exchange for withdrawal from captured territory and a just solution for the Palestinian refugees.

Egypt's assistant foreign minister for Arab affairs, Hani Khallaf, was quoted as saying Monday that the Arab side cannot negotiate on behalf of the Palestinians.

Lebanon's Prime Minister Fuad Saniora, responding in Beirut to a question on Olmert's call, said the Arab peace initiative was "based on the very principle of land for peace. And this is something that Israel has to understand."

Saniora said Israel's use of military force and launching wars on Lebanon and Arab countries did not bring peace. "Therefore, I think it's about time for the Israelis to realize that eventually it is important to establish real peace in the region and accept the Arab peace initiative in its entirety," Saniora said.